Apple is reinventing itself. Where do they go from here?

The Mm, the iPs, advanced editing in iPhoto and new and exciting GarageBand tools all herald the coming of a brand new Apple. All of these things have been dubbed by conventional wisdom to be impossible for any number of good reasons. Yet here they are. They have even rediscovered DTP after several years of neglect. What gives? SJ has recently gone on record as bashing flash-based players. Is it my imagination, or did someone recently suggest that Apple had no intention or desire to play in the bargain basement PC arena? All of a sudden, they do a complete 180. Obviously, they have been working on these items for a long time and have been purposely deceiving us. Why? And why now? What are the implications for future hardware coming from this company? Will we soon see the end of the $3000 desktop? Will the iMac finally take its place in the sub-zero category? Will the eMac gracefully curl up and die? Consider the falling prices on monitors. Has Apple finally got religion on pricing? If Apple had done any one of the things it did at MWSF, it would have been newsworthy. To have done all of it all at once is a message in and of itself. So what is the message. And what other sacred cows will Apple slaughter next? Thoughts?

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The Mm, the iPs, advanced editing in iPhoto and new and exciting GarageBand tools all herald the coming of a brand new Apple. All of these things have been dubbed by conventional wisdom to be impossible for any number of good reasons. Yet here they are. They have even rediscovered DTP after several years of neglect. What gives? SJ has recently gone on record as bashing flash-based players. Is it my imagination, or did someone recently suggest that Apple had no intention or desire to play in the bargain basement PC arena? All of a sudden, they do a complete 180. Obviously, they have been working on these items for a long time and have been purposely deceiving us. Why? And why now? What are the implications for future hardware coming from this company? Will we soon see the end of the $3000 desktop? Will the iMac finally take its place in the sub-zero category? Will the eMac gracefully curl up and die? Consider the falling prices on monitors. Has Apple finally got religion on pricing? If Apple had done any one of the things it did at MWSF, it would have been newsworthy. To have done all of it all at once is a message in and of itself. So what is the message. And what other sacred cows will Apple slaughter next? Thoughts?

The gospel according to steve..

Apple makes great software the hardware is ubiquitous .... as long as apple makes it.

Apple is very focused on doing certain things extremely well and digital media (e.g., music, video and photography) are their areas of focus. With Quicktime 7 and 802.11n, Apple will have the tools to go after the living room and mobile video. Long standing rumors of Apple HD projectors look promising based on Steve's "you can wonder why" comment in the beginning of his presentaion. I would not be surprised to see Apple flat-panel TVs if they launch a media center and TV show and movie download store.

The new iPhoto was a bit of a surprise to me (hooray for RAW support!) but I do not think we've seen the end of this. They've clearly built the foundation for advanced photography software and CoreImage will take it to the next level.

Music is an area where they might invest some of their $6+ billion in cash. There's a number of possible aquisitions which would give them a firmer position in music-related hardware that could integrate with their software.

Depends on how we slice this tomato, or peel the onion. Isn't Pixar into games? I could see Apple buying a gaming company and/or making much better tools for game writers to use. I have no idea of the porting tools that game porters use and or where they would need better tools. My guess is better vectoring tools which I hear is coming to GCC, auto vectoring tools, which should help performance. But my guess is that just better tools for porting the game would be a huge boost for Apple. Also, Apple may have other interests here as well, in that by having their own gaming division even if it is small would allow them first hand information on how easy or difficult it is for games to be created and ported to OSX. I could see Apple using this as a win win in that Apple could make a few games with a small division and port a game or two and not rock the market too much but then they could use what they learned to make better tools and put them in the OS or in Xcode for all to benefit from. To me this would be money well spent as well as resources well spent.

I'm not sure the Mac Mini looks like a good corporate desktop after all. It may be that its main purpose is to gain a bigger foothold in the home market to prevent encroachment by gradually-improving console boxes.

Windows is a dinosaur, yes, but its major extinction phase will be on the corporate desktop, as corporations switch to Linux in a huge tidal wave.

As for gaming, that market is being lost to consoles. It'd be nice if Mac Mini numbers could attract some developers to the platform. The hardware is certainly adequate.

As far as gaming, I think Apple would be very pleased if the commodity PC business got split into different "genres" like gaming, home media (creative applications), music, TV, etc. I think Apple won't get into that fight because it leaves MS and Sony at least somewhat distracted and Apple then has a better chance in some of these other areas.

Console gaming and computer gaming are two completely different things. They're are game types I'd much rather play on a console than a computer and vice versa. It'd like like calling WinXP and OSX the same thing.

Consoles suck and so does that tv your watching your game on. Ill take a PC/monitor over any console 365 days a year. This is a major flaw with all of Apples products because all of them have cheap/slow video so the Gamer/PC user cant really consider a Mac due to pitiful hardware and pitiful game selection. Apple needs to really get behind gaming and get behind videocards that can run those games. PC side is making big money and the Mac side looks the otherway. without Aspyr and Macsoft Mac gaming would be dead and without them why would ATI even bother with that 2 or 3% market. So apple needs to support gaming, needs to use REAL VIDEO CARDS not soldered on crap from years ago and a way to watch tv off your Mac built in. Pod will be hot for a while until everyone gets one and has their libraries filled. Apples hardware division has struggled for years with its all in one's vs powermac while pc side lets you build the machine to suite you. CPU speed,video card,mem, etc in Apples world its all in ones with crap video or top of the line powermac just to have the option of getting out of their FX5200/9200 world Please video on Mac is sorry. Why they dont build a machine half the size of powermac with its fastest single cpu and a video card slot and say a couple pci slots is beyond me. Guess the customer could get what they want rather then apple telling them what they need. Couldnt have that could we

The last thing Apple needs to do is to get itself tangled and FuXor3d in the gaming world. Sorry. Laugh all you want about Apple' video cards for gaming, they seem to be making much better use of them in other areas that suit Apple's markets and interests best.

The computer industry is diverging into different, more specialized markets, and Macs/Apple don't have much of a chance in the gaming platform wars. Why waste the money and effort? As soon as HD sets and consoles gain critical mass in a few years, the PC as we know it will lose its place as the best gaming environment once and for all. Everyone in gaming knows that.

I guess I should have anticipated that this would become a Mac gaming debate. I don't believe that Apple can do anything about the gaming situation. They already employ questionable marketing tactics on this front. The hardware is just not up to the task. Gaming drove the PC platform to where it is today. There were no such forces on the Mac side. Microsoft saw the potential in PC gaming and with Direct X, practically invented the PC gaming platform. Apple has done nothing to encourage game development for the platform that is anywhere on par with what MS did. MS has an underlying strategy of entertainment. This is evident in their gaming and TV/Media Center initiatives. Apple is about creativity. Just look at iLife. Whatever Apple tackles next, I think it will be something that enables creativity, not entertainment. iTunes being the one exception.

Gaming on the Mac is not going to improve folks. Yes gaming is an industry that generates more revenue than Hollywood but it's also a risky and expensive venture as well.

The excitement for Apple right now has to be continuing to evolve the digital hub and lifestyle devices and perfect their product portfolio here.

Consumers are eating up new technologies like never before. The adoption rate of things like HDTV and Digital Music is astounding. The question is "what do consumers want?"

The reality is they want efficiency.

iTMS excels because it saves me from the need to hop in the car and go see if that hot album is in stock at the retail location. It allows me to sample music and find new artists. It develops a sense of community with iMixes.

Consumers watch a lot of television. Apple would be pound foolish to ignore this trend and to date I don't think they have ignored it. DVRs and timeshifting are not only requested but demanded by todays busy families. Prime Time no longer exists anymore. You want to see the next iPod phenomenon..wait for the first company that can create a DVR option that is mutually beneficial for consumers and advertisers. I don't have the answers yet about how to accomplish that but I do have a hint to advertisers. Consumers will only care about your adverstising if they perceive some benefit from it. Find a way to keep my interest that goes beyond silly adolescent material. Come to the 21st century.

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Digital AV

-

We have the tech now.

AAC- for great music.

AVC- Great video

Airport-Wireless transport.

Rendezvous(Opentalk)- Easy network discovery.

Quicktime 7- Capable media framework.

It's time to preheat the oven and get this mix started. If Apple can do for the home what they've done for mobile audio they have another huge hit on their hands. I sense that the hardware is just now ready for an Apple assault here.

The pieces are spread out along the board, my guess is as good as any, but this is, what I believe, Apple is gearing up towards:

Wireless networking, pushing higher and higher speeds not as a gimmick (since residential speeds are barely above 4Mb/s as we speak, well within the 802.11b range) but as a necessity.

The Year of HD...but not on the desktop

The Mac Mini...sans monitor

Rendezvous...configuration

All of a sudden we have not just the computer as a digital hub, but the computer as a wireless transmitter of ALL media. An Apple HD projector connects easily and wirelessly to any mac in the house via 802.11n (out later this year, and why the groundwork is being laid for the "Year of HD" mentality). The projector allows for the signal to be processed by the Mini (with enough power to decode HD and run an OS at once) and sent to the projector via the wonderful new codec.

Via another little wireless wonder (the upgrade to Airport Express) the sound signal is directed into the surround system (ever wonder about the digial connect for something as simple as iTunes files? Stereo sound doesn't need a digital signal, but 5.1 - 7.1 does). Consider Sony a partner.

Boom, you have a DVD player, Television (I'd guess around 1500-2000 dollars) and wireless interconnect for less that most people currently pay for an HDtv, along with the convenience of placing the components more freely, and experiencing the ease of setup.

That solves the interconnectivity issue, but what about the media itself? iTunes? Not on your life. DVDs are fun, and the Mac Mini plays them, but more importantly, downloads are cheap and easy. Downloads via the new store are, let's say, $3 bucks apiece for 48 hours of all-you-can-watch, and $5 to own. Given a choice, people will choose to own, as "it's just 2 dollars more." Want special features? They're a buck apiece, or less. For $10 bucks, you can own the whole DVD and throw it onto that shiny new firewire media drive connected to the Mac mini. It' not just movies either, a buck apiece for network TV shows? Want to own all of 24, $24. Easy. Watch it anytime you want.

itunes proved one thing to Apple more than anything else. People want the convenience of downloading, not the cheapness of it. It proved that given the choice, 230,000,000 people chose to pay, once again for the convenience.

One Last thing, you're going to want the convenience of not having to deal with a keyboard. You're going to want a remote. You're going to want a remote that's smart enough to be integrated into the OS and provide easy function and one-step DVD or download options. I think they can handle that for $100, they already have.

Like I said, the pieces are already in play, this is how I see the checkmate happening. It's not in Apple's interest to follow, it's in their interest to lead. Media PCs suck, for lots of reasons. Fix the reasons, make it easy, make it simple, make it interconnected and easy to set-up and make it wireless and people will sit-up and pay attention. All of a sudden you have a revolution on your hands, where both Apple and the entertainment industry are profitting. Oh, and Sony knows this and wants in, they're knocking at the door and offering any help they can give. Sony sees the writing on the wall and knows that Apple is 3 years of research and chess-piece-placement ahead of them. Instead of fighting, why not partner and allow for Sony products to also work with Apple?

The writing is on the wall people, at least to me.

Of course, in the long run, I could be wrong...or I could already be right.

OK, bringing this back from gaming, since any venture into that thicket just gets us all tangled in brambles and thorns.

The important thing to keep in mind when trying to read the tea leaves like this is that Steve and the crew are absolute masters of the head fake, and the fact that they have much more information than any of us makes this tactic an almost guaranteed success. So, with that in mind:

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Originally posted by Mac Voyer

All of these things have been dubbed by conventional wisdom to be impossible for any number of good reasons. Yet here they are. They have even rediscovered DTP after several years of neglect. What gives? SJ has recently gone on record as bashing flash-based players. Is it my imagination, or did someone recently suggest that Apple had no intention or desire to play in the bargain basement PC arena? All of a sudden, they do a complete 180.

That's the trick: They didn't.

When calling Pages DTP, recall that Pages is really just a logical extension of MacWrite, adjusted for hardware capability. The Mac brought some of the tricks of professional publishing to the word processor all the way back in 1984. All Apple really did was revisit the problem twenty years later. If that takes down a few bloated dinosaurs, well, it did twenty years ago too. But people don't use Quark or InDesign just for their ability to flow text around an image.

The flash players he were bashing were the things with 32MB or some other amount that basically reduced them to tiny CD players, only more difficult and unfamiliar to work with. Apple waited until they could get a respectable amount of flash memory, and then did the same thing they did with the iPod, stripping the interface down to an elegant expression of what you most commonly need and use.

As for the Mac mini: As many people have noted, the mini doesn't compete in the cheap space. You can get entire systems for roughly its cost, if that's what you want. The cheapest Apple system is still the eMac. So, watch the head fake: They're not offering cheap systems, because there's no money to be made there. The mini is in its own category, it's profitable in its own right, and it offers all kinds of opportunities for upsell&mdash;right up to the iMac, which, all the griping on various web forums notwithstanding, is still Apple's flagship consumer line.

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Will we soon see the end of the $3000 desktop? Will the iMac finally take its place in the sub-zero category? Will the eMac gracefully curl up and die? Consider the falling prices on monitors. Has Apple finally got religion on pricing?

The $3000 desktop will die when there's no longer a market for absolute power. Given that Apple is moving into high-end film and 3D and supercomputing, this will happen approximately never. Remember, the top-end PowerMac is replacing $10k - $50k UNIX and AVID workstations more often than not, and even a fully kitted top-end PowerMac stuffed with 16GB of Apple-installed RAM looks like a steal to these guys.

I fully expect the iMac to drop in price over time, the way the original CRT iMac did. A $999 17" iMac G5 should be eminently feasible.

Apple's steadily falling monitor prices are at least as old as the original 22" Cinema Display. That's how long they've been pulling down a top-end panel from the stratosphere and slowly percolating it down through the line. The 20" Cinema Display costs as much as my 15" Studio Display did when I bought it (that pitiful sound you hear is my weeping). Note that, as with computers, they're staying out of the low end.

The eMac will gracefully curl up and die when educational institutions (and the parents of young children) are no longer enamored of kidproof monoliths. Considering that the demand for that style is older than the PowerPC, I wouldn't hold my breath. However, I do see the eMac retreating back to the educational niche, and cede the consumer desktop field to the Mac mini and a cheaper iMac.

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If Apple had done any one of the things it did at MWSF, it would have been newsworthy. To have done all of it all at once is a message in and of itself. So what is the message. And what other sacred cows will Apple slaughter next? Thoughts?

Well, it looks like they're doing what Fred Anderson said they'd do when they hit $10B in revenue. For years, they were hampered by the fact that their revenue from Mac sales basically paid for most, and occasionally all, of their operational expenses, and any remainder was posted as a profit. This left them with very little wiggle room.

Now, they have wiggle room. So yes, I expect them to be much more aggressive, and much more unpredictable now. If the iPod shuffle and the Mac mini are as successful as they seem to be (remember, the iMac 2 was strong out of the starting gate too!) that will only encourage them.

There's another thing to consider, which I will add in even though this is Future Hardware: Tiger is in many ways the first final release of OS X. They're finally publishing stable low-level APIs, freezing the existing APIs, and getting rid of the last compromises made early on, and slowing the dev cycle down. When Tiger ships, OS X will have matured. Anyone who underestimates the significance of that milestone is in for a lot of surprises, even though its significance will be realized gradually (as Tiger and successors make up more and more of the installed base).

Thanks Amorph for that thoughtful commentary. I found myself being hypnotically drawn into your argument that this is really not a shift for Apple. Then I came to the end of your post, shook my head, splashed water on my face and said "No way, man! This is totally new!" SJ didn't bash flash based players in the same way that Clinton didn't lie. Not a cheap Mac? I think even SJ in his keynote used the words "cheap Mac". I suppose you can come up with your analysis if you carefully parse his words. But everyone in the Mac community and the main stream press certainly thought they heard what I did. So that is clearly the impression Apple meant to give.

I also dispute the idea that the eMac is a better value. An eMac style monitor can be had very cheap. Mouse and keyboard? Even if Apple had included a mouse and keyboard, people would still be heading off to CompUSA to buy new peripherals. The Apple rodent is one of the reasons many PC users don't take the Mac seriously. Even the Mac users who buy this thing, (that includes me), will be using existing or third party mice. The ram seems to be sufficient for every consumer Mac product and a good many people would have it upgraded by the store they bought the computer from anyway. No savings there. Besides, it seems rather silly to try and pimp out a $499 box. Anyone who does it almost deserves to get fleeced. This is not a case of deceptive marketing. SJ pitched it as a cheap Mac for people who want to try out the platform and who already own the necessary peripherals. For such people, it is a $499 box. If you don't fit in that narrowly defined category, then it is not intended for you. SJ would rather you buy an iMac anyway. Pimping out this box doesn't help Apple. It only helps resellers and Apple does not seem to care much for them these days.

As for the living room. I just don't see it. Apple does seem to have at least one core value. Every product they make, with the exception of the iPod and iTunes/iTMS is geared toward enabling the end user's creativity. They have no interest in entertaining the end user. That's what the living room is for. I would even argue that the music initiatives are geared toward creativity in as much as no truly creative person is divorced from music. It is more than the soundtrack of our lives. It is often a catalyst for creativity. I believe they will brand a digital camera long before they brand a TV. I see them working with Sony to produce the Apple DV cam. I see hardware for musicians such as the rumored Asteroid. I believe that anything they do in the living room will be limited to enabling us to share our creations with others through the entertainment center. They do be the provider of entertainment content. I happen to like their strategy of enabling creativity. But if I prove to be all wet and they come out with an HDTV, I promise not to go Palmer on you.